CORPORATE VEIL UNDER THE LAWS OF VIETNAM

General understanding, the corporate veil is a legal concept that separates the personality of a corporation from the personality of its owners or shareholders and protects them from being personally liable for the corporations debts and other obligations. In order to understand what the corporate veil is under the laws of Vietnam we should discuss the following fundamental issues:
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Limited liability of owners or shareholders hereinafter collectively referred to as !owners"# of a corporation$ and %eparate corporate personality$

1.

Limited Liability of &wners 'nder the (nterprise Law )**+, an owner of a corporate is only personally liable for the corporations debts and liability within his,her subscribed capital or capital being committed to be subscribed. -umber amount of the subscribed or committed capital of .founding/ owners shall be registered in the charter i.e. articles of incorporation#. 0he owners have to ma1e payment in consideration of their own registered share capital within a specific period agreed by owners but no later than the relevant period re2uired by law. 0here are difference between how shareholders of a company in form of 3oint stoc1 company !JSC"# and members,investor of a company in form of a limited liability company ! LLC"# will ta1e liabilities as owners of the company. Liabilities of a member of a LL4 will be limited to an amount of capital that such member commits to contribute to the LL4 while liabilities of a shareholder of a 5%4 will be limited to issued and paid-in shares of such shareholder.

2.

%eparate 4orporate 6ersonality